Woodside's Browse deal with CPC lapses

Woodside Petroleum Ltd.’s proposed Browse LNG Project has suffered a blow as the company has let lapse a supply deal with Taiwan’s CPC Corp.

Woodside said its LNG key terms agreement with CPC was allowed to expire on June 21 with the consent of both parties.

In November 2007, the two firms had signed the agreement involving the potential sale of 2-3 million tonnes/year of LNG over 15-20 years.

CPC also was in negotiations to purchase as much as a 10% interest in the Browse project itself. It was hoped that both agreements would be finalized this year.

CPC’s withdrawal means that Woodside now has only one offtake deal for the Browse project—Japan Australia (MIMI)—which has offered to buy 1.5 million tpy of LNG.

The news adds further uncertainty to the project that has yet to decide whether gas will be brought ashore at the new James Price Point Kimberley hub or transported further south via pipeline to existing systems on the Burrup Peninsula.